Fauji Fertilizer Bin Qasim Limited (FFBL) is scheduled to announce its financial result for 1HCY23 on 21st Jul’23, where we expect the company to post a loss after tax of PKR 3,837mn (LPS: PKR 2.97) compared to a profit after tax of PKR 3,410mn (EPS: PKR 2.64) in SPLY due to massive exchange loss of PKR 4,620mn during 1QCY23. On a quarterly basis, the profitability is estimated to be PKR 1,592mn (EPS: PKR 1.23), plummeting by 11% YoY on the back of 21% and 24% YoY decline in urea and DAP offtake, respectively.

Whereas urea and DAP prices surged by 43% and 3% YoY, respectively. Gross margins are forecasted to settle at 13.0% during 2QCY23 vis-à-vis 19.1% in SPLY owed to lower DAP sales tagged with usage of expensive fuel for urea plant due to outage at FPCL (duration of which was one month). Furthermore, financial charges are expected to climb up by 3.2x YoY due to the jump in interest rates. Other income is set to grow by 32% YoY, given the expectation of higher dividend income from Pakistan Maroc Phosphore S.A., Morocco.

Courtesy- AHL Research